What is social shopping and why is it important to business?

Social shopping is rapidly becoming a vital channel for engaging with new and existing customers, but poorly applied it can cause widespread distrust of a brand. Getting it right is now critically important to every business.

Social ShoppingSocial media has changed the way we interact as human beings forever. Actually, to be more precise, it’s allowed us to re-engage with each other on a personal and direct level in a way we haven’t since the development of globalisation. As part of the shift towards a new, global society commerce has also had to readjust to a personal social marketplace.

This phenomenon is known as ‘social shopping’; the idea that businesses can now communicate their values, products and brand in a personal and direct way while consumers can discuss their commercial activity openly and with millions of people.

So who’s doing this well? New companies like Blippy have fully embraced the social shopping phenomenon with a unique concept that allows users to link their purchasing habits with their social networks. By creating a free account (or logging in with Facebook Connect or Twitter) you can ‘link’ your Blippy account to popular retailers such as iTunes, eBay, Amazon or Zappos.

You can even link to a range of popular high street credit and debit cards; offline transactions are captured so it doesn’t matter where you spend. This means every time you indulge in a new pair of shoes or the latest album, it’s immediately shared with everyone in your social networks.

Spending and peer-to-peer monitoring

For consumers, this has the great effect of not only keeping friends informed of what they are interested in, it can also act as a ‘spending monitor’ to curb impulse buys. Users are amazed at how much harder they think about spending money (and spending it wisely) when they know everyone will find out about it!

Peer-to-peer services, which allow the renting or swapping of goods between individuals, have also captured the spirit of social shopping brilliantly. New sites such as Rentoid, Swapit and new UK start-up Whipcar offer this kind of service. Need a lawnmower for the weekend? Rent it from a neighbour! Need a car for two hours, you can rent that too! Want new games for your Xbox or Nintendo Wii? Swap them for old ones you’re bored of playing.

The great thing about this crowd-sourced approach is that it demonstrates the democratic power of the social web. For example, you don’t need to be a big business to generate new income from your assets, you just need something to offer for rent and a Rentoid account.

Existing social networks are proving to be fertile breeding grounds for social shopping with Facebook becoming a target for businesses and individuals looking to sell their products. DIY e-commerce applications such as Payvment make setting up an online shop so easy anyone can be selling from their Facebook Page to their fans in minutes. This is the ideal way for brands to generate a direct ROI from social media, which will add value to building a fan base as the results are more tangible and trackable.

A Facebook shop is also a great place to road-test new products to the small and targeted sample group of your Facebook Fans. You will probably receive more honest feedback from Fans because they have an emotional connection with your brand; they have opted in to being part of your community.

[Next: The power of positive review]

The power of positive review

Social shopping also gives consumers unprecedented power to comment, rate and review products and brands. Stalwarts such as Amazon have long fostered a reviews and ratings system that has become so trusted it is virtually a public service. Many companies have emerged which syndicate and aggregate review content. A great example is Retrevo which scours the net for consumer electronics reviews and pulls them into one place; invaluable when choosing that new digital camera or flatscreen TV.

Of course, whilst positive reviews can greatly increase conversion it can also work against a poor product. It is now more important than ever to make sure you are delivering quality at every stage of the manufacture and supply process. Production or supply problems can now go from being the private frustrations of an individual to public news in minutes.

And it’s not just spending money which has found a home in the social web, but saving it too. Many people are publicising their road to debt recovery on debt blogs such as www.bloggingawaydebt.com, which records every cent spent by their bloggers. The aim is to use the public ‘outing’ of spending to help people focus on keeping their wallets in their pockets. The support and camaraderie that goes with this network is also a great way for members to keep a positive attitude when trying to scrimp and save.

The impact for your business?

First, and most critically, all businesses now need to think about social media image and personality – what’s the tone of voice of your business? What are you passionate about? How do you want to engage with consumers in the social marketplace?

Businesses need to develop a comprehensive social media strategy, which considers a variety of sales channels, not just traditional ones. Don’t just blitz your Facebook Fans with broadcast messages advertising your e-commerce website. Instead, start discussions about the wider context of your industry and link this to carefully targeted products available to buy direct from your Facebook page.

Businesses also need to think more about a long-tail approach to sales channels. Now there are infinitely more areas to make money online than ever before with markets more diversified and communities based around interests; tailoring your approach to this is critical.

There is a far more level playing field than ever before and competitors are not just other big brands but also individuals, even your own customers! This is good news for start-ups because it has never been cheaper and easier to gain a foothold in the market just by doing things a bit differently.

[Next: Cultural shift to word-of-mouth]

Cultural shift to word-of-mouth

Possibly the biggest cultural shift businesses need to make is utilising humble old ‘word of mouth’ as a direct action which can affect millions of people. Getting a ‘bad rep’ in the social media space can be devastating for a business. Actively managing your brand’s reputation is paramount.

Considering social media as part of the marketing mix can no longer be something you should do, but a complete essential. You only have to see the effects of getting the message wrong, such as for a certain unnamed Australian sandwich spread brand, to realise how important it is. Doing this effectively can be the difference between success and failure in the current retail landscape.

Social shopping presents a fantastic opportunity for innovative and forward thinking businesses to open up new revenue streams and generate closer relationships with their customers than ever before. Having a clear strategy, targets, objectives and a sensible ‘step-by-step’ approach is vital.

Remember that both your customers and your business are just groups of connected individuals. By humanising your business approach you will gain acceptance into the social shopping community, build trust and loyalty, create new brand advocates and watch your profits grow as quickly as your fan base.

–Simon McEvoy is a director at Tangent One

www.tangentone.com.au

Twitter: @tangentone

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